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Klarna's listing is the most-anticipated fintech IPO in years and is widely seen as a bellwether for the rest of the sector. 

Why it matters: The pending IPO could encourage a growing push toward profitability for fintechs looking to go public.

The big picture: Many in the industry see Klarna as an ideal candidate to open the IPO window.

"In any normal historical context, Klarna would already be public. It's a scale player [with] over $100 billion in GMV, over $2 billion in revenue, and profitable," says Rainmaker Securities managing director Greg Martin.

Follow the money: "If Klarna does well, we'll see Chime and Revolut right behind it," Martin says.

Catch up quick: Klarna is expected to list at a valuation of $15 billion to $20 billion, roughly in line with rival Affirm's current market cap.

Yes, but: That valuation would be well below the nearly $46 billion it was valued at in a 2021 fundraise.

Reality check: Other fintechs may face a similar reset if they seek to follow Klarna.

"There might have been a hope… that companies could grow into their valuations. But the reality is, we're not getting back to those times," says Nnamdi Okike, managing partner at 645 Ventures and NVCA board member.

Like Klarna, Chime raised funding in the frothy fundraising environment of 2021.

At the time, it was valued at $25 billion. But some industry insiders expect it to list for around $10 billion if it goes public this year.

Between the lines: Many expect Klarna's profitability will be crucial to investor interest in its stock, which could set the bar for other listings.

While its 2024 profit was modest — just $21 million on $2.8 billion in revenue — it was a significant improvement over the company's $244 million loss the previous year.

"That's rare for a venture-backed company. It'll be interesting to see how the market values that," Defy partner Medha Agarwal says.

State of play: Other 2025 IPO candidates are touting profits or severely cutting their losses. 

When eToro filed last week, it reported a profit of $192.4 million, up 1,160.7% from the year prior.

Like Klarna, Revolut's annual financials are publicly available — and it has been talking up its profitability for years.

Chime's financials are closely held, but one report indicates that while it wasn't profitable for the year, it lost less than $50 million, a significant narrowing from a $200 million loss in 2023. 

What they're saying: "Klarna looks like a solid business — not growing the fastest, not extremely profitable, but solid," Okike says.

The bottom line: Fintech saw listings get clobbered over the last several years after a series of loss-making companies went public, so solid might just be good enough. 

Klarna's coming IPO could offer a fundamental reset

The pending deal could encourage a growing push toward profitability.

Illustration of a bull on a red carpet that's rolling up

Klarna&#x27;s listing is the most-anticipated fintech IPO in years and is widely seen as a bellwether for the rest of the sector. Why it matters: The pending IPO could encourage a growing push toward profitability for fintechs looking to go public.

Klarna's coming IPO could offer a fundamental reset

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